US markets close with some gains following fluctuations in global stocks over Donald Trump's tariffs
China raised import taxes on US goods to 125%, in response to a 145% levy on some of its goods imported to America
"The fight will only be short term": People in China tell the BBC how they think the trade war will affect them
The US dollar falls to a three-year low as Deutsche Bank says "the damage has been done"
Trump says the US is "doing really well on our tariff policy" and "it is moving along quickly", as the White House says tariffs are "necessary to make America wealthy again"
How is the trade war with the US affecting people in China?
Shares in Japan, South Korea and Australia have fallen at the open on Friday.
The Nikkei 225 index was trading around 5% lower.
The Kospi lost 1.6% while the ASX 200 fell by around 2%.
When President Trump announced he was putting some of the most eye-watering tariffs on pause, shares stopped sliding and rallied. But the market turmoil is far from over.
Trump left in place a tariff of 10% on imports from most countries and a tariff of 145% on goods from China, which is America's third largest source of foreign-made goods.
Here's how Wall Street's three major indexes closed on Thursday.
Image source, Getty ImagesIf you are just joining us now, here's a quick look at what's happened over the past few hours:
We are keeping an eye on Asia-Pacific financial markets that have just opened.
Shares in the region climbed on Thursday after Trump paused most higher tariffs, even as he increased levies on China.
Here is where major indexes stood at the end of yesterday's trading.
India stock markets were closed for a public holiday but will reopen later today.
Image source, Getty ImagesThe US is experiencing "transition difficulty", Donald Trump said today.
What does that look like? All three of the main American measures of investor confidence were down again today on Wall Street - a far cry from the rampant optimism that followed the US president's decision to pause the vast majority of tariffs on Wednesday.
At a carefully choreographed televised cabinet meeting, Trump focused on yesterday's "big day" for markets, a day of record gains - but came close to accepting it has been a bumpy ride for the US economy this week.
Meanwhile, traders were processing the White House's clarification that the effective tariff rate for China is at 145%, 20 percentage points higher than had previously been assumed.
Beijing's 84% tariff on US goods remains in place. As part of the deepening trade war, China announced on Thursday it would be reducing the number of American films shown in its cinemas.
Elsewhere, Democrats are calling for an independent investigation into whether anyone in Trump's inner circle took advantage of insider knowledge to make stock market bets before the tariff pause was announced - an allegation the White House has rubbished.
There is still a long way to go on this story. We're pausing our live coverage for the time being but will be bring you all the latest across BBC News.
We've been speaking to regular Americans in California about how they view the tariffs. Here is what Steven had to say.
At Seaside Bikes in Newport Beach, California, most of the inventory is made in China and that worries owner Steven Ma.
He relies on rentals and has a warehouse full of bikes, so he says he can weather the trade war - for now.
Steven plans to hold off buying any new inventory and hopes the trade war will be over by the time he needs more bikes.
“Going forward, future bikes, newer models, the price is going to be probably $800-$1000 more than they are now,” he says. Shipping costs alone are going up by as much as 60% he says.
Is there a made-in-the-US option he could turn to?
“No,” he says. "It’s the labour costs.”
Regan Morris
Reporting from California
We've been speaking to regular Americans in California about how they view the tariffs. Here is what Ryan had to say.
Walking through the tourist shopping area of Newport Beach, his arms laden with newly bought souvenirs, Ryan Raiker says he’s not worried about tariffs – he’s optimistic that it will create jobs for his friends.
“As a young person I look at the tariffs as something long-term,” he says. He runs his own tech marketing business and says the job market has been extremely volatile for him and his peers.
“Tariffs look like something that will help us bring jobs and bring things back to the US. Many of my friends who are in their 30s are unemployed and have been for the last year and a half,” he says.
“We’ve got to have jobs here.”
As we've been reporting, the White House has confirmed the tariff rate on most Chinese goods is 145%, rather than the 125% that was previously assumed.
Yesterday, Trump paused the introduction of higher-band tariff rates for a host of countries for 90 days.
Instead, the US president rolled out a temporary 10% rate across the board while trade talks are held with individual governments.
China, however, was singled out for an even higher rate. Here's the state of play now.
As we've been reporting, Democrats have called for an investigation into trading which took place shortly before Donald Trump announced a pause on the majority of tariffs, which triggered massive stock market gains.
Shortly before, the president wrote on social media that it was a "great time to buy".
Democratic Senator Elizabeth Warren calls for "a full independent investigation on who was trading, who made money, who knew what and when".
But Republican senator John Cornyn says "any idea of insider trading is ridiculous," as it's "pretty obvious that when a stock market is in a dip" it's a good time to invest money.
Senators react to talk of insider trading during stock market surge
Earlier today, Prime Minister Keir Starmer said UK-US trade talks are "advanced" and "making progress".
But he cautioned that striking a deal would "not be the end of the challenge", and told the BBC that he is focused on "turbocharging our economy".
Starmer refused to be drawn on the "precise percentage of tariffs" that would remain in place between the UK and US under the terms of a potential trade agreement.
"I'm not pretending to predict the future," he said. "What I do know is this is not a passing phase. It’s not something where in two or three months we’re going to be back where we started."
As a reminder, the White House says it is open to trade talks with countries around the world over a 90-day period in which the highest tariffs will be paused for everyone but China.
Image source, ReutersIn the UK, talks to nationalise British Steel are still ongoing, the BBC understands.
A source told us that it's likely talks will continue into tomorrow as the government considers taking the Chinese-owned business into public ownership.
The negotiations are set against the backdrop of steel exports to the US being hit with a 25% tariff, adding to the problems facing a UK steel industry which has struggled to compete with cheaper products from elsewhere for many years.
British Steel, which has been owned by China's Jingye since 2020, says its two blast furnaces in Scunthorpe are "no longer financially sustainable".
The plant is at risk of running out of raw materials within weeks, raising fears over whether its blast furnaces, which make high grade steel, can keep running.
But the British government views a functioning domestic steel industry as a critical economic security issue, despite big questions about the future of the steel trade.
Malu Cursino
Live reporter
Image source, Getty ImagesSoya is the US's main exported good to China. Now, as the trade war between the world's largest economies deepens, Beijing is taking its money elsewhere.
Brazil is the world's main soya exporter and it's getting ready to step up its shipments to China, a longstanding ally and the world's main soya importer.
China imported more than $56bn in soya in 2023 alone. Nearly 70% of that came from Brazil, while 26% came from the US, external.
As the feud grows, America's soya trade with China could be up for grabs, with Brazil the likely beneficiary.
Analyst Wan Chengzhi, from Capital Jingdu Futures, says traders are monitoring an "expected wave of soybean imports" from Brazil later this year.
From tofu to alternative milks, soya is a common part of our diets, and it is also used in processed foods made with an emulsifier called lecithin.
Soya is also used as livestock feed, a practice widely criticised by climate activists, external, who say its production leads to deforestation and planet-warming greenhouse gases.
Erin Delmore
North America business correspondent, in New York
Hello from a chilly Wall Street, on a notably less jubilant day.
Gone is the euphoria from yesterday’s trading session, which saw the major US indexes notch their biggest one-day gains in years.
They resumed their run in the red Thursday, at one point halving yesterday's gains.
The sell-off deepened after the White House clarified that tariffs on imports from China totalled not 125%, but 145%, after stacking the new number on top of an earlier tariff rate.
Investors worry that the tariffs on China and other countries will ultimately weaken growth.
The New York Stock Exchange closes soon - we'll bring you the latest numbers shortly.
Image source, Truth SocialAs we just reported, the White House has pushed back on Democratic politicians claiming Donald Trump or his inner circle may have illegally profited from swings in the stock market through insider trading and market manipulation.
There is no evidence that Trump or any of his advisers engaged in insider trading, which is the purchase or sale of shares based on information unknown to the market. This is a crime under US law.
On Wednesday, Trump said on social media it was a "great time to buy", hours before he temporarily lowered tariffs imposed on goods from dozens of countries, which caused the stock market to soar.
California Senator Adam Schiff, a long-time Trump critic, said questions should be asked about whether "people around the president" traded stocks in advance of the public announcement,
Bernd Debusmann Jr
Reporting from the White House
Earlier today, I asked the White House about comments from some Democrats - such as California Senator Adam Schiff - calling for an investigation into market manipulation, after yesterday's tumultuous day on Wall Street and the upswing following Trump's tariff announcement.
In a statement sent to the BBC, White House spokesperson Kush Desai says "it is the responsibility of the President of the United States to reassure the markets and Americans about their economic security in the face of non-stop media fearmongering".
"Democrats railed against China’s cheating for decades, and now they’re playing partisan games instead of celebrating President Trump’s decisive action yesterday to finally corner China," Desai adds.
The White House has also pointed to comments, some going back as far as 1996, in which Democratic lawmakers commented with alarm about China's trade deficit with the US, including one from now Chuck Schumer, now the Senate minority leader, in 2007.
Whether they’re making boats, hairbows or sauces, small business owners across the US say they’re already feeling the squeeze of tariffs.
“It has already decreased our average order value on our website. I think some businesses will just have to close – and it will be a slow death,” says South Carolina business owner Rozalyn.
Rozalyn and her daughter Gabby founded Gabby Bows, which sells special barrettes for curly hair. They rely on goods from China, which faces a newly raised 145% tariff.
Image source, Gabby BowsKayak and paddleboard-maker Steve from Boston also expressed that sentiment.
The high tariffs on China "basically eliminates any profit" from his business, he says. He’s now being forced to reconsider his business’s flagship product.
In New York, the owner of speciality Indian sauce and pickle company Brooklyn Delhi, fears the spices she gets from India are about to get wildly expensive.
“They're just not available domestically so we're backed into a corner on that front,” Chitra says.
Chitra adds she could get doubly hit, as she orders jars from Taiwan and China. If things get more expensive for her customers, she doesn’t know if they’ll stick around.
Cai Pigliucci
Reporting from Virginia
Out in picturesque Leesburg, a historic small town in Virginia, there's a sense of unease in the streets.
The rapid changes in policy have confused many here. "The unsettledness of it all has caused everybody you deal with to be unsure. There's just this sense of uncertainty," says Steve Ball.
Further down the street, Julia Misra was potting flowers in front of one of her businesses. "People are going to be very disappointed at what they're having to pay," she tells me.
She manages a small business of 25 people in the wellness sector, and Misra adds she's had to watch every dollar carefully.
"This administration promised that they would be cutting costs instead, all of our food prices are going to go up, all of our product prices."
Misra buys products from China, and while she'd love to buy from the US it financially doesn't always make sense for her or her business. She's worried all of those purchases will now cost her much more.
"In the end, we're a global economy now, and the sooner people get on board and realize that, you know, the sooner we're going to be on the right path," she says.
Julia Misra
John Sudworth
North America Correspondent
Image source, John Sudworth/BBCDown the street from Gerald Brobst’s shop, I meet Ghassan Saoud, who owns a small furniture store.
Just like the violins, he says no one can now really compete with China when it comes to cost and quality, showing me different models of sofa that have all come from Chinese factories.
He’s far less sanguine about the possibility of soaking up what he believes may be – if the tariffs stay in place - a more than doubling of his prices.
“It’s scary,” Ghassan tells me. “I know that it’s going to affect us negatively because most of our products that we buy and sell in this store are made in China and that means that the importer, the one I buy my furniture from, will have to raise their prices.”
John Sudworth
North America Correspondent
Image source, John Sudworth/BBCI’ve been talking to businesses in Virginia about the possible impact of the punishing China tariffs.
Gerald Brobst has run his violin shop for more than half a century and, over that time, he’s seen China become a dominant player.
They now compete on both cost and quality, he said as he pulls different models from the shelves of his stunning showroom, wall to wall with beautiful instruments.
But Brobst says he voted for Donald Trump and – whatever the impact on his business – supports what the president is doing on China.
“There’s no question about it,” Brobst tells me. “They’re cheaters, thieves and scoundrels,” before quickly adding, “I mean the leadership.”
“The Chinese people,” he goes on, are "just good workers and very talented and all that but they’ve got a bad leadership, it’s a bad system.”
If pushing back on such a system and its export dominance means bearing higher prices, well, Brobst says that’s a price he’s willing to pay.
World affairs editor John Simpson is asked what is motivating China in its "fight to the death" stance in opposing steep US tariffs.
As a reminder, the US has levied a 145% tariff on goods imported from China.
Simpson says the Chinese see this as a battle about "future of the world" and China vs America.
He explains for four years top Chinese officials have been saying openly China is the dominant power. "Here we have the test," John says.
"There's no possibility of [China] backing down... if China does cave into American pressure then president Xi Jinping will pay the price for it."
Simpson adds he thinks Donald Trump sees it in the same way as being a fight between China and America, but the US President thinks he can win it.
